Date: 20100527
Docket: A-155-09
Citation: 2010 FCA 138
CORAM: BLAIS C.J.
EVANS J.A.
SHARLOW J.A.
BETWEEN:
SANDRA
GALLANT
Appellant
and
HER
MAJESTY THE QUEEN
Respondent
Heard at Fredericton,
New Brunswick, on May 27,
2010.
Judgment delivered from the Bench at Fredericton, New Brunswick, on May 27, 2010.
REASONS FOR JUDGMENT OF THE COURT BY: EVANS
J.A.
Date:
20100527
Docket:
A-155-09
Citation:
2010 FCA 138
CORAM: BLAIS
C.J.
EVANS
J.A.
SHARLOW
J.A.
BETWEEN:
SANDRA
GALLANT
Appellant
and
HER MAJESTY
THE QUEEN
Respondent
REASONS FOR JUDGMENT OF THE
COURT
(Delivered
from the Bench at Fredericton, New Brunswick, on May 27,
2010)
EVANS J.A.
[1]
This
is an appeal by Sandra Gallant from a decision by the Tax Court of Canada (2009 TCC 91),
in which Justice Angers dismissed her appeal from the reassessments by the
Minister of National Revenue for her 2001 and 2002 taxation years. The Minister
reassessed Ms Gallant for unreported business income of $114,365 for 2001, and
$137,360 for 2002.
[2]
Ms
Gallant operated special care-homes in those years providing care services to
residents. She says that means and need tested payments made by the Province of New Brunswick under
statutory programs in respect of residents in the care home, where she herself
resided with her family, are excluded from income.
[3]
She
relies on paragraph 81(1)(h) of the Income Tax Act, R.S.C. 1985,
c. 1 (5th Suppl.), the relevant parts of which provide:
|
81.(1) There shall not be included in
computing the income of a taxpayer for a taxation year,
…
(h) where the
taxpayer is an individual (other than a trust), a social assistance payment
(other than a prescribed payment) ordinarily made on the basis of a means,
needs or income test under a program provided for by an Act of Parliament or
a law of a province, to the extent that it is received directly or indirectly
by the taxpayer for the benefit of another individual (other than the taxpayer’s
spouse or common-law partner or a person who is related to the taxpayer or to
the taxpayer’s spouse or common-law partner), if
…
|
81.(1) Ne sont pas inclus dans le calcul du
revenu d’un contribuable pour une année d’imposition :
[…]
h)
la prestation d’assistance sociale, sauf une prestation visée par règlement,
qui est habituellement payée à un particulier, à l’exclusion d’une fiducie,
dans le cadre d’un programme prévu par une loi fédérale ou provinciale, après
examen des ressources, de besoins et du revenu — dans la mesure où il la
reçoit, directement ou indirectement, au profit d’un autre particulier, à
l’exception de son époux ou conjoint de fait ou d’une personne qui lui est
liée ou qui est liée à son époux ou conjoint de fait — si, à la fois :
[…]
|
[4]
The
Judge held that the payments in question were not social assistance payments
received by the provider of the services (here, Ms Gallant) for the benefit of
the residents. Relying on earlier decisions of the Tax Court to the same
effect, he said (at para. 19):
The long-term
care services are provided to beneficiaries, subsidized or not, in return for
the payment of the rate set by the Province and are purely contractual in
nature. The appellant is in the business of providing long-term care services
and the beneficiaries purchase those services by paying the rate established by
the Province. The fact that some beneficiaries have qualified for a subsidy
does not change the contractual nature of the services nor does it make the
subsidy a social assistance payment made to the home operator on behalf of the
beneficiary.
[5]
The
Judge also quoted from the judgment in Anderson v. R, [2001] 4 C.T.C.
2837 (TCC), where Justice O’Connor said (at para. 8) that paragraph 81(1)(h)
“was never intended to exempt income earned by a person running a business at a
profit.”
[6]
We
are not persuaded that on the facts before him, Justice Angers committed any
error of law, or palpable and overriding error of fact or of mixed fact and
law, in concluding that the payments made by the Province in this case do not
fall within paragraph 81(1)(h).
[7]
For
these reasons, the appeal will be dismissed with costs.
“John
M. Evans”
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: A-155-09
(APPEAL FROM
A JUDGMENT OF THE TAX COURT OF CANADA DATED MARCH 6, 2009, BY THE HONOURABLE
JUSTICE ANGERS,
DOCKET NO. 2006-3534(IT)G)
STYLE OF CAUSE: Sandra
Gallant v. Her Majesty the Queen
PLACE OF HEARING: Fredericton, New Brunswick
DATE OF HEARING: May 27, 2010
REASONS FOR JUDGMENT OF THE COURT: BLAIS C.J., EVANS AND SHARLOW JJ.A.
DELIVERED FROM THE BENCH BY: EVANS J.A.
DATED: May 27, 2010
APPEARANCES:
|
W.S. Reid Chedore
|
FOR THE APPELLANT
|
|
David I.
Besler
|
FOR THE RESPONDENT
|
SOLICITORS
OF RECORD:
|
Mosher Chedore
Barrister and Solicitors
Saint John, NB
|
FOR THE APPELLANT
|
|
Myles J.
Kirvan
Deputy Attorney General for Canada
|
FOR THE RESPONDENT
|
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